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Friday, September 29, 2017
U.S. pork industry continues to grow
The U.S. pork industry continues to grow as producers take a measured approach in advantageous market conditions including cheap feed prices and strong demand.Analysts saw no surprises in the latest USDA Hogs and Pigs report, which indicated a healthy, profitable industry going forward.Total U.S. inventory as of Sept. 1 was 73.5 million head, up 2 percent from the year earlier and up 3 percent from the June report.Breeding inventory, at 6.09 million head, was up 1 percent from last year and up slightly from the previous quarter.Market hog inventory, at 67.5 million head, was up 3 percent from last year and up 3 percent from last quarter.The June-August 2017 pig crop, at 33.0 million head, was up 2 percent from 2016.
Cow herd expansion will continue
A recent report indicates that cow herd expansion will continue, but there should be no need for additional beef packing capacity. CoBank's Knowledge Exchange Division released the report saying herd expansion will rise another 3-5% in 2018 and 2019. Expansion in the past few years has been fueled by improved pasture conditions and continued profitability in beef production. In the past three years expansion has been the most aggressive on record, says Trevor Amen, animal protein economist at CoBank. “Recent slaughter numbers and the cattle on feed mix indicate the expansion rate is slowing, but barring any significant export market disruptions or weather events, expansion will continue through the end of the decade,” Amen says. Despite an increasing cow herd bringing more market ready cattle through the supply chain, slaughter capacity should remain sufficient. "Plants will add additional slaughter hours to manage the extra supply through 2019," Amen says. "The biggest potential concerns as the industry drifts closer to maximum packing capacity are labor availability and temporary plant closures for unforeseen maintenance issues." Packers have been proactive since mid-2016 when they began adding more hours for slaughter on Saturdays. There is little chance of any recently closed packing plans reopening. CoBank analysts believe packers will add more robotics and automation to limit the need for skilled labor. Export growth looks like it will continue, helping beef producers and packers remain profitable. For 2017, exports are on pace to increase 7-9%, while 2018 exports are projected to increase 5-7%. “Export demand has been strong,” Amen says. “Momentum has been building since July 2016 and forecasts continue to adjust upward for the remainder of this year. Combined with decreased imports, we’re experiencing a more favorable net trade balance and keeping domestic per capita supplies in check while supporting prices levels.”
Cattlemen “Very Pleased” That Tax-Reform Blueprint Includes Death Tax Repeal, Will Fight to Maintain Existing Positive Provisions in Tax Code
WASHINGTON (Sept. 27, 2017) — Craig Uden, President of the National Cattlemen’s Beef Association, today released the following statement in response to the “Unified Framework” for comprehensive tax reform legislation:
“Our Nation’s cattle producers are very pleased that President Trump and Republican leaders in Congress have maintained their long-standing commitment to American agriculture by including a full repeal of the onerous death tax in the Unified Framework for Fixing Our Broken Tax Code. We look forward to working with the Administration and lawmakers on Capitol Hill as pen meets paper on tax legislation, and will continue to demonstrate how the death tax and its associated costs adversely affect family-owned operations and the rural communities they support.
“Also, current provisions in the tax code that help livestock producers maintain economically viable businesses and support the success of future generations of farmers and ranchers must be preserved. Stepped-up basis, cash accounting, like-kind exchanges, cost recovery, and the deductibility of interest payments are just a handful of the provisions that allow agricultural producers to survive despite the many challenges we face, from market volatility and fluctuating input prices, to droughts, wildfires, and floods, to the challenge of generational transfers. We’ll closely monitor these provisions as more details on legislative language become available, and intend to fight tooth and nail for a tax code that supports America’s beef producers.”
Throughout September, NCBA has executed an extensive online media campaign to promote comprehensive tax reform. The group yesterday released the campaign's fourth video, which has collected more than 57,000 views in less than 24 hours. As the end of the campaign draws to a close, the videos featuring beef producers have already been viewed a combined 317,000 times and have reached more than 590,000 people on Facebook.
“Our Nation’s cattle producers are very pleased that President Trump and Republican leaders in Congress have maintained their long-standing commitment to American agriculture by including a full repeal of the onerous death tax in the Unified Framework for Fixing Our Broken Tax Code. We look forward to working with the Administration and lawmakers on Capitol Hill as pen meets paper on tax legislation, and will continue to demonstrate how the death tax and its associated costs adversely affect family-owned operations and the rural communities they support.
“Also, current provisions in the tax code that help livestock producers maintain economically viable businesses and support the success of future generations of farmers and ranchers must be preserved. Stepped-up basis, cash accounting, like-kind exchanges, cost recovery, and the deductibility of interest payments are just a handful of the provisions that allow agricultural producers to survive despite the many challenges we face, from market volatility and fluctuating input prices, to droughts, wildfires, and floods, to the challenge of generational transfers. We’ll closely monitor these provisions as more details on legislative language become available, and intend to fight tooth and nail for a tax code that supports America’s beef producers.”
Throughout September, NCBA has executed an extensive online media campaign to promote comprehensive tax reform. The group yesterday released the campaign's fourth video, which has collected more than 57,000 views in less than 24 hours. As the end of the campaign draws to a close, the videos featuring beef producers have already been viewed a combined 317,000 times and have reached more than 590,000 people on Facebook.
China Set to Import $100 Million Worth of U.S. Peanuts
China is buying U.S.-produced peanuts on a very high level. The USDA says that will continue. An Agri-Pulse report says China will purchase $100 million dollars of American peanuts. Sales data so far in 2017 says it very well could happen. The U.S. has already sold $29 million dollars’ worth of peanuts from Texas, Georgia, Alabama, North Carolina, Virginia, as well as other states in just the first seven months of this year. The peanut industry is taking notice of the potential for China as a large market for its products. Total peanut exports were worth $4 million dollars just a few years ago, which means peanut farmers are very optimistic about the future of China as an export market. The jump in peanut exports to China actually began just last year. China ramped up its imports during the summer of 2016, with the total imports last year at $172 million. That’s a roughly 700 percent increase from the $22 million China imported as recently as 2015.
Packer Capacity to Keep Up With Expanding Beef Herd
A new report says the U.S. beef herd will keep expanding through the end of this decade but there shouldn’t be any need for increased beef packer capacity. The report from CoBank says the herd will increase 3-5 percent from 2018-2019. Improving pasture conditions and continued profitability in the beef sector have been fueling herd expansion in recent years. Trevor Amen, animal protein economist at CoBank, said over the last three years, the expansion has been the most aggressive on record. He says, “Recent slaughter numbers and the cattle on feed mix indicate the expansion rate may be slowing, but barring any significant export interruptions or weather events, the expansion will continue through the end of the decade.” The increasing cattle numbers are bringing more market-ready cattle through the supply chain but expectations are that slaughter capacity should remain sufficient. Amen says plants will be adding extra working hours to get through the increasing supply through 2019. The biggest potential concerns as the industry drifts closer to capacity are labor availability and unforeseen plant shutdowns for maintenance.
Brazil Says U.S. Ban on Brazilian Beef May End in October
Brazil’s agriculture ministry says that the ban on fresh Brazilian beef exports to the United States may be lifted in October. The ban was first implemented in June. A Reuters article says it would end after the U.S. finishes evaluating the responses on documents sent in response to questions raised earlier this year during a U.S. veterinary mission to Brazil. Brazil exports three percent of its overall beef exports to the U.S., but America is seen as a leader in food safety and other countries will take their cues if America ends the ban. The prediction on the end of the ban came after Washington D.C. informed Brazil it would allow thermprocessed beef imports to resume from five beef plants in the country. Back in March, Brazil unveiled an investigation into meatpackers accused of bribing inspectors, which led many countries to ban Brazilian beef imports. While many countries have already lifted their ban, the U.S. has not yet done so, saying there is no timeline in place for lifting the ban as of yet.
Organic Field Crop Production Numbers Rising
Organic farming is a rapidly growing segment of U.S. agriculture. Organic vegetables, fruits, and livestock make up the bulk of the entire segment. However, a new USDA report shows organic field crops are making gains in the number of acres planted and overall value. The National Ag Statistics Service released the numbers showing that U.S. farms and ranches produced $7.6 billion in certified organic commodities in 2016. That’s up 23 percent over the previous year. The number of certified organic farms also climbed 11 percent higher, coming in at 14,217 last year. The number of certified acres is up 15 percent to five million acres. Livestock marketed as organic can only consume feeds certified through the USDA’s organic program. That’s helping to drive organic production of corn, soybeans, and hay. The USDA report says about 7,400 farms planted 1.6 million acres of organic field crops and hay last year. The value of organic field crop sales totaled up to more than $762 million in 2016, more than $100 million dollars higher than in 2015. Organic corn had the most acres planted, totaling almost 214,000 acres last year.
Mexico Says U.S. Proposals Would Threaten Free Ag Trade
Pan Am Post Dot Com says the U.S. will be putting forth controversial proposals during the next round of North American Free Trade Agreement negotiations. The U.S. will allegedly be putting forth proposals for what it calls “seasonal windows” when it comes to agriculture trading with Mexico and Canada. The article says this type of a proposal would be a form of “managed trade” by establishing seasonal ag trade restrictions in North America. The president of the Mexican National Agriculture and Livestock Council offered an example of what that means. He says America wants to establish conditions saying that when Georgia produces strawberries, Mexico either won’t be able to export strawberries to the U.S. or would only be allowed to put the same amount of strawberries into the marketplace that Georgia has. Ag trade hasn’t been limited by seasonal windows since 2008, when a period of 15 years of gradual reduction was established. Mexico’s general coordinator of International Affairs says the Mexican government and producers won’t even consider discussing the proposal.
NAFTA Nations Reports Progress Despite Tensions
Negotiators in the North American Free Trade Agreement talks say they’re making progress after the third round of talks concluded Wednesday. A Bloomberg report says that talk of progress comes as tensions grow between the U.S. and Canada over aircraft. The U.S. imposed trade duties on Canadian-made aircraft, inflaming tensions with Canada. The nations did make some progress in the talks, including closing out the chapter on small and medium-sized businesses. The U.S. Commerce Department made the decision to impose duties on Bombardier’s marquee jetliner on the final day of negotiations. Canada’s Foreign Minister calls the Trump Administration “protectionist,” saying that fact is no big secret to the rest of the world. At the same time, she says the Bombardier issue is separate from the NAFTA negotiations. Negotiators did say they made progress in several different areas, including telecommunications, digital trade, and state-owned enterprises. The chapter on competition will probably be agreed on before the next round of talks begins.
Conservation Groups Urge Increased Funding In Farm Bill
Conservation groups are urging on Congress to increase funding in the 2018 Farm Bill and to strengthen current conservation efforts to ensure farmers, ranchers and foresters can effectively access those programs.The recommendations were released September 27 and more than 20 organizations that contributed input were listed as supporters. The consensus document asks for a large increase in funding for conservation programs, but supporters make it clear they do not want these funds to come at the expense of other programs in the farm bill.The set of recommendations highlight a number of programs with detailed lists of necessary changes and several conservation provisions that also need changes. Although conservation advocates are asking to increase funding in programs they are also looking to change the requirements for some.
Washington Insider: Tensions Over USDA’s Organics Program
The relationship between USDA and the organic foods industry it supports has always been uncomfortable, and may be coming to an end, Politico says.Politico lists several tension points, beginning with the National Organic Program’s chief Miles McEvoy’s preparation to retire at the end of September. Politico also notes “growing concerns about import fraud and the delay by USDA of a slew of pending standards.” The industry has long had sharp internal splits over its standards but Politico says they are now “bracing for a future of regulatory unknowns.”Earlier this month, for the first time in the industry’s history, it sued the federal government over the delay in implementing a long-sought organic animal-welfare standard that had been under development for more than a decade and was supposed to address how the animals that produce organic milk, meat and eggs should be treated.Part of the problem, Politico says, is that while the industry has grown from $8.6 billion in annual sales in 2002 to $50 billion in sales in 2016, the government has been “hesitant to increase funding.” The National Organic Program only receives $9 million in funding a year and is staffed by 35 people.While the Senate proposed an increase in funding to $12 million a year in the 2018 agriculture appropriations bill, the House did not. “Their resources have not grown in accordance with the growth of the industry, so they are still trying to do as much as they were for a much smaller sector,” Barbara Patterson, government relations director for the National Farmers Union, told Politico. “So there are some inherent challenges to trying to govern organic with such a small staff and limited resources.”As a result, some organic companies are adding private certifications to their products to show consumers they are doing such things as humanely raising poultry or that their dairy products stem from grass-fed animals. “It’s all up to us for making sure we are reliable and accountable for what we are selling,” said Kim Dietz, senior manager of environmental, natural and organic policy for J.M. Smucker Company. “We can’t count on the government.”Into this turmoil, Kathleen Merrigan, an organic advocate and former USDA deputy secretary and now executive director of sustainability at George Washington University, provides a somewhat different view. It’s not just organic producers that are having to look outside of the government for solutions to problems that used to get a regulatory fix, she says and points to a number of initiatives including climate change that “should be addressed with federal rulemaking, but are likely to be ignored in the administration’s push to cut regulations,” she says.“We are entering an era of alternative government schemes where industry has to step up,” she said.The fact is, the organic industry and the federal certification program that has been administered by USDA since the late 1980s has not only been controversial, but has been continually involved in internal struggles, as well.It was conceived as a way to end, or reduce, the use of chemicals and other “non-natural” compounds in food production but has almost always involved advocates who wanted to restrict food production to certain systems and types of farms considered “sustainable”. And, it has frequently included advocates who said or hinted that all other food was “dangerous” to an important degree, although scientific studies have repeatedly found that not to be the case.There are other controversies, as well. One is the fact that organic production, as the USDA certification program defines it, is far less efficient than modern ag systems so those foods cost consumers far more and its potential for expansion has been restrained, as a result.Still, organic foods have claimed a growing, if small, share of U.S. food sales and seem likely to continue to grow, although it likely will continue to have problems redefining the U.S. food system as some advocates have said they would like it to be.And, even though the industry may chafe under USDA bureaucrats, it likely is far better off under USDA’s seal of approval, than on its own. So, it seems likely that the industry will survive the coming retirement of a well- liked official, but will continue to struggle internally to redefine its products to meet advocates’ preferences with little if any additional federal funds, Washington Insider believes.
Thursday, September 28, 2017
Media Attention Focused On New Tax Proposal
Much of the media attention this week is focused on the next bitter political battle, the administration’s new tax proposal. Bloomberg says the framework now being released proposes cutting the top individual rate modestly to 35%, but leaves it up to Congress to decide whether to create a higher bracket for those at the top of the income scale.The rate on corporations would be set at 20%, down from the current 35%, and businesses would be allowed to immediately write off their capital spending for at least five years, Bloomberg said. Pass-through businesses would have their tax rate capped at 25%.The plan is expected to contain three tax brackets for individuals, 12%, 25% and 35%, down from the existing seven rates, which top out at 39.6%. The unusual feature of this outline is that the administration understands from the outset that the details are not firmly set and congressional tax-writing committees are specifically given flexibility to add a fourth rate for the highest earners in an effort to prevent the overhaul from providing too much of a benefit for the wealthy.Congress members haven’t signaled that they’ll take that option, Bloomberg says. Key Republicans on the tax-writing Ways and Means Committee, including Chairman Kevin Brady, R-Texas, say they’re committed to offering across-the-board tax relief. By contrast, the President has repeatedly said he’s focusing on middle-class individuals.At the same time, the plan calls for repealing the alternative minimum tax and the estate tax, both of which would be a boon for higher earners and the wealthy.On the international side, the plan would move toward ending the unique worldwide approach the U.S. uses to tax corporate profits regardless of where they are earned and would focus primarily on multinationals’ domestic earnings.Companies with accumulated offshore profits would be subject to a one-time tax on those earnings, clearing the way for that income to return to the U.S., Bloomberg says. The rate that would be applied is unclear, but it would vary depending on whether the income was held in cash or less liquid investments. Firms would be able to pay the new tax over several years.In terms of middle-class benefits, the framework outlines a near doubling of the standard deduction to $12,000 for individuals and $24,000 for married couples, and calls for “significantly increasing” the child tax credit from the current $1,000 per child under 17.There is obviously a great deal of detail still to be revealed regarding the plan, Bloomberg says. For example, it still lacks extensive details about ways to offset its rate cuts with additional revenue. It says most itemized deductions for individuals should be eliminated, without providing specifics, at the same time it calls for mortgage interest and charitable giving deductions to be preserved.
Farm Bureau Reacts to Tax Reform Framework
The American Farm Bureau Federation says tax reform framework released Wednesday includes important principles for agriculture. Farm Bureau President Zippy Duvall said in a statement that AFBF was encouraged by the inclusion of lower tax rates for individuals who own businesses, elimination of the death tax and some business interest deductibility. However, AFBF says any tax reform package should also include the continuation of cash accounting and like-kind exchanges, unlimited stepped-up basis and lower capital gains taxes. President Trump announced the tax reform framework at the Farm Bureau building at the Indiana State Fairgrounds. Meanwhile, the National Cattlemen’s Beef Association welcomed the tax plan, saying cattle producers are “very pleased” with the President’s plan.
South Korea Trade Representative Meets with U.S. Lawmakers
South Korea’s Trade minister is meeting with lawmakers in Washington, D.C. this week, ahead of a meeting with U.S. Trade Representative Robert Lighthizer next month. Lighthizer will meet with Korea next month to discuss a “path forward” for KORUS, The U.S.-Korea Free Trade Agreement. Korea’s Trade Minister has met with agriculture sector lawmakers, including Nebraska Republican Deb Fischer, to discuss KORUS, along with Iowa’s Chuck Grassley, according to Politico. Fischer maintained support for KORUS, “because of the great economic benefits it provides” agriculture. South Korea will host the next trade meeting with the U.S. on October 4th. The Trump administration is seeking to amend the five-year-old deal to address the country's growing deficit in trade with South Korea.
Syngenta Reaches Settlement in Viptera Case
Syngenta has reached a settlement with farmers involved in lawsuits over the launch of Syngenta's Agrisure Viptera and Agrisure Duracade corn traits. The lawsuits alleged Syngenta’s release of traits unapproved in China led the nation to reject U.S. corn shipments and pushed corn prices lower. The settlement is estimated to be close to $1.5 billion, according to Reuters. The settlement does not apply to lawsuits filed by U.S. grain handlers Archer Daniels Midland and Cargill against Syngenta. Further, cases brought by farmers in Canada are also still pending. Syngenta says the proposed settlement would allow both sides to avoid the uncertainty of ongoing litigation. Lawyers representing corn farmers in the federal litigation confirmed what they called a “preliminary settlement framework.” Syngenta has denied any wrongdoing in the case.
Ireland Tops U.S. in Food Security
For the first time, the United States has dropped from the top spot in a global ranking of how well countries can feed their own people. A new ranking shows Ireland now as the world’s most food secure nation, with the U.S. the second most food secure nation. Bloomberg reports the drop in food security for the U.S. can be attributed to concerns about agricultural research spending and government policy trends, which may make the world’s top food exporter a less-certain place to get a meal. Researchers for the Global Food Security Index say Ireland has improved its food affordability, availability, quality and safety over the last year. When including climate as a factor of food security, the U.S. fell even further to fourth on the list. This is the sixth annual ranking of food security by the Economist Intelligence Unit, a London-based economics group. Overall, global food security declined for the first time in five years, largely because of increases in the number of refugees, weather disasters and a decline in global political stability.
BPI Using Settlement Funds to Help Employees
Owners of Beef Products Inc. have established a $10 million fund to benefit former BPI employees impacted by plant closures. The fund will help employees who were laid off when sales dropped stemming from a series of reports about the company's Lean Finely Textured Beef product broadcast by ABC News. BPI laid off roughly 750 employees and closed facilities in Iowa, Kansas and Texas at the time of the reports in 2012. Following a settlement with ABC in its lawsuit, BPI announced the fund this week. In June, BPI settled a $1.9 billion lawsuit against ABC and correspondent Jim Avila for defamation and claims that the network had used false information. The settlement amount was not made public, but the Walt Disney Company ABC's parent company, listed a $177 million litigation settlement in a quarterly financial filing.
Coffee Supplies May Drop on Low Farm Earnings
International coffee growers are warning less coffee supplies may be in the future as coffee farmers are earning very little globally. The International Coffee Organization this week said farmers’ low earnings in many countries were depressing supply even as demand grows around two percent annually, according to Reuters. Rabobank last month forecast a 2017-18 global coffee deficit of 6.1 million bags amid rising demand, and signs of tightening supplies that are evident in top coffee grower Brazil, where inventories have dropped sharply. Investing in new coffee trees requires a long-term commitment, one that farmers with low profits are having to carefully consider, leaving global supplies in jeopardy. Coffee is primarily grown in Brazil, Vietnam, Colombia, Indonesia and Ethiopia.
Wheat Organizations Applaud Trump Administration’s Aggressive Trade Enforcement at the WTO
ARLINGTON, Virginia — U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) welcome the decision by the Trump Administration to make sure China is living up to its commitments on wheat trade. In response to action by the Administration, the World Trade Organization (WTO) Dispute Settlement Body has established a panel to rule on a complaint filed in December 2016 by the United States Trade Representative (USTR) regarding China’s administration of its tariff rate quotas (TRQs) for wheat and other agricultural products. USW and NAWG are very pleased with the Trump Administration’s aggressive use of the WTO dispute settlement mechanism on behalf of wheat farmers.
This is the second panel established at the WTO under the Trump Administration to defend the interests of wheat farmers. The first will examine whether China’s market price support programs for wheat, corn, and rice violate its trade commitments. According to a 2016 Iowa State University study sponsored by USW, China’s market price support programs cost U.S. wheat farmers between $650 and $700 million annually in lost revenue by pre-empting export opportunities and suppressing global prices.
China also has a WTO commitment for an annual TRQ of 9.64 million metric tons (MMT) of imported wheat. The panel established Sept. 22, 2017, in the TRQ case will review evidence that China has not administered this TRQ in a transparent, predictable and fair manner as required by its WTO obligations. The result is that China’s TRQ administration unfairly impedes wheat export opportunities for U.S. wheat farmers, as well as farmers from Canada, Australia and other wheat exporting countries, to the detriment of Chinese consumers.
“It is very encouraging to see the Trump Administration defend farmers against governments that say to the world they will live up to their commitments, but then scheme to disregard the rules we all need to ensure global trade is conducted freely and fairly,” said NAWG President David Schemm, a wheat grower from Sharon Springs, Kan. “Wheat growers will always stand up and applaud when the Administration expands, improves and enforces trade agreements on behalf of farmers.”
“Trade enforcement is crucial for building confidence in existing and new trade agreements,” said USW Chairman Mike Miller, a wheat farmer from Ritzville, Wash. “The Trump Administration’s actions should send a signal that strong and enforceable trade rules are vital to the United States and to U.S. farmers, specifically.”
This is the second panel established at the WTO under the Trump Administration to defend the interests of wheat farmers. The first will examine whether China’s market price support programs for wheat, corn, and rice violate its trade commitments. According to a 2016 Iowa State University study sponsored by USW, China’s market price support programs cost U.S. wheat farmers between $650 and $700 million annually in lost revenue by pre-empting export opportunities and suppressing global prices.
China also has a WTO commitment for an annual TRQ of 9.64 million metric tons (MMT) of imported wheat. The panel established Sept. 22, 2017, in the TRQ case will review evidence that China has not administered this TRQ in a transparent, predictable and fair manner as required by its WTO obligations. The result is that China’s TRQ administration unfairly impedes wheat export opportunities for U.S. wheat farmers, as well as farmers from Canada, Australia and other wheat exporting countries, to the detriment of Chinese consumers.
“It is very encouraging to see the Trump Administration defend farmers against governments that say to the world they will live up to their commitments, but then scheme to disregard the rules we all need to ensure global trade is conducted freely and fairly,” said NAWG President David Schemm, a wheat grower from Sharon Springs, Kan. “Wheat growers will always stand up and applaud when the Administration expands, improves and enforces trade agreements on behalf of farmers.”
“Trade enforcement is crucial for building confidence in existing and new trade agreements,” said USW Chairman Mike Miller, a wheat farmer from Ritzville, Wash. “The Trump Administration’s actions should send a signal that strong and enforceable trade rules are vital to the United States and to U.S. farmers, specifically.”
Montana Department Of Ag to Host Food Show On October 10th
Bozeman, Mont. – The Montana Department of Agriculture (MDA) will be hosting the first annual Montana Food Show in Bozeman at the Best Western Plus GranTree Inn on Tuesday October 10, 2017. More than 40 Montana fresh produce, meat, food and spirit companies will be showcasing their products to both professional buyers and the general public, with the goal of getting more Montana foods and beverages on Montana plates and in Montana glasses. “Based on conversations we’ve had with Montana food and agriculture companies across the state, there is a need for an event like the Montana Food Show to connect local food and beverage companies with statewide and regional buyers,” said MDA Director Ben Thomas. “We are excited to host this tradeshow and look forward to the connections that will be made between food and beverage companies and institutions of all kinds.” MDA is partnering with Montana Team Nutrition, National Center for Appropriate Technology’s Farm to Cafeteria Network, Lake County Community Development’s Mission Mountain Food Enterprise Center, Montana State University Culinary Services, the Montana Food and Agriculture Development Center Network, Bear Paw Development Corporation, Prospera Business Network, Western Sustainability Exchange, and the Made in Montana program to host this first annual event. A list of Montana companies attending this event can be found at www.foodshow.mt.gov. Professional buyers from schools, restaurants, hospitals, grocery stores, catering companies, and other organizations interested in local food can register at the same address. The show will be open to professional buyers only from 10am-4pm and to the general public from 4pm-7pm. The Montana Department of Agriculture’s mission is to protect producers and consumers, and to enhance and develop agriculture and allied industries. For more information on the Montana Department of Agriculture, visit agr.mt.gov.
Ban on fresh Brazilian beef exports to the United States could be lifted in October
The ban on fresh Brazilian beef exports to the United States could be lifted in October, Brazil’s agriculture ministry said late on Tuesday.The ban, implemented in June, would end after the United States finishes its current evaluation of documents sent in response to questions raised in a U.S. veterinary mission to Brazil earlier this year, according to a statement on the ministry’s website.The United States accounts for 3 percent of Brazil’s fresh beef exports annually, but is seen as a leader in food safety standards with other countries often taking cues.The predicted end to the ban comes after Washington informed Brasilia that it would allow thermoprocessed meat exports from five plants to resume, according to the ministry.“We received information that processed beef was cleared,” Agriculture Minister Blairo Maggi said, according to the statement. “We hope that very soon, we will also be able to clear fresh beef.”Brazil exported $211.2 million worth of processed beef to the United States in the year through August, or 30,031 tons, according to data from the Abiec industry group.Following a meeting with U.S. Agriculture Secretary Sonny Perdue shortly after the ban came into effect, Maggi had predicted that the embargo could be lifted in 30 to 60 days, dates which have since passed.The United States said previously there is no timeline for lifting the ban.Brazil in March unveiled a probe accusing meatpackers of bribing inspectors, leading many countries to temporarily suspend Brazil meat imports. Most have since lifted the bans.The United States stepped up inspections after the probe and canceled one establishment’s exporting license in connection with it, Abiec said, before instituting a broader ban. The United States accounted for 5.3 percent of Brazil’s total fresh and processed beef exports last year, Abiec data show.Brazil has since pledged to tighten food safety inspections and hired more inspectors
September USDA Cattle on Feed report pegs the September 1 feedlot inventory at 10.504 million head
The September USDA Cattle on Feed report pegs the September 1 feedlot inventory at 10.504 million head, 103.6 percent of last year. August placements were 102.6 percent of year ago levels. Placements were larger than expected and may well provoke a bearish market response. What may be overlooked are the continued strong marketings pace. August marketings were close to pre-report expectations at 105.9 percent of last year. Marketings outpaced placements in August and pulled down the year over year increase in feedlot inventories, though not as much as expected. For the first eight months of the year, total placements are up 1.16 million head, an 8.4 percent year over year increase. However, total marketings were up 0.847 million head, 6.1 percent more than last year and largely offsetting the increased placements. As a result the September 1 on-feed inventory was up a modest 369 thousand head year over year.Higher feedlot throughput is reflected in the year to date increase in steer and heifer slaughter, up 5.9 percent year over year. Steer slaughter is up 3.3 percent while heifer slaughter is up 11.7 percent for the year to date. Additionally, beef cow slaughter is up 11.3 percent so far this year and rising dairy cow slaughter is up 3.9 percent for the year to date. Total bull slaughter is also up 13.1 percent year over year.Offsetting increased cattle slaughter are lighter carcass weights. While steer and heifer carcass weights are increasing seasonally, they remain below year earlier levels. In the most recent data, steer carcasses were 896 pounds, 7 pounds below one year earlier; heifer carcasses were 816 pounds, down 5 pounds from the same date last year. For the year to date, steers carcasses have averaged 14.1 pounds lower than last year while heifer carcasses are 12.3 pounds lighter. Total beef production for the first 36 weeks of the year is up 4.5 percent year over year. Annual beef production is projected at 26.3 billion pounds, up 4.4 percent year over year. Domestic beef consumption is projected at 56.6 pounds per capita, up 2.2 percent year over year. Despite the increase in domestic beef consumption, retail beef prices remain strong. August Choice beef price was $5.94/lb., down from $6.10/lb. in July but nearly one percent higher than August last year. The all-fresh beef retail price was $5.794/lb. in August, fractionally higher than one year ago. Beef production is expected to increase again in 2018, currently projected at 27.4 billion pounds. This would be a record level of U.S. beef production, exceeding the previous high of 2002 with 27.0 billion pounds. Increased beef production, combined with other meats, is projected to surpass 101 billion pounds of total meat production in 2018, a new record as well. Clearly the supply challenges will continue for the foreseeable future. However, 2017 has demonstrated very well that strong domestic and international demand for U.S. beef can mitigate much of the price pressure from growing beef production. Continued strong beef demand can limit 2018 cattle and beef price changes to modest declines.
Wednesday, September 27, 2017
New Report Defends US Farm Programs
A comprehensive study by Brandon Willis, a lawyer, academic, and former administrator of USDA's Risk Management Agency (RMA), examined the implications of the Heritage Foundation recommendations to eliminate the farm bill's safety net, deeply cut and phase out crop insurance, make unilateral concessions in the context of the World Trade Organization (WTO), and repeal U.S. domestic trade laws.Willis labels the report flawed because it "selectively uses data" to draw certain conclusions. Heritage said agricultural risk is no different than the risks of other businesses. But Willis countered that Heritage ignores data showing the "rate of return on agricultural assets exceeded the return on nonfarm assets in only one of 32 years,” and that the higher income volatility for agriculture is due to "weather-related risks and global markets distorted by high foreign subsidies, tariffs, and non-tariff trade barriers,” and that exit rates in agriculture are higher than other businesses even with a safety net in place.China Delays Food Import Regulations for Two Years
China will hold off implementing new food import regulations until October 2019, the country has notified the WTO. "The General Administration of Quality Supervision, Inspection and Quarantine of China is currently studying the comments from relevant countries/regions," said the notification."According to the comments and application received, we hereby decide to provide a transitional period of two years: from 1 October 2017 to 30 September 2019." The U.S. and European Union (EU) had pushed for a delay in the regulations, maintaining it could negatively impacts billions of dollars in trade. The rules would have required all food imports to have health certificates, even for products that are considered low risk.
China will hold off implementing new food import regulations until October 2019, the country has notified the WTO. "The General Administration of Quality Supervision, Inspection and Quarantine of China is currently studying the comments from relevant countries/regions," said the notification."According to the comments and application received, we hereby decide to provide a transitional period of two years: from 1 October 2017 to 30 September 2019." The U.S. and European Union (EU) had pushed for a delay in the regulations, maintaining it could negatively impacts billions of dollars in trade. The rules would have required all food imports to have health certificates, even for products that are considered low risk.
Higher Supplies Keeping Consumer Meat Prices Lower
Higher supplies of meat will continue to pressure consumer prices lower, according to a forecast by the Department of Agriculture. The USDA Economic Research Service Food Price Outlook predicts beef and veal prices to decrease one to two percent in 2017 but increase the same amount in 2018. That’s because in August, the U.S. cattle herd was at its highest level since 2008, according to meat industry publication Meatingplace. Lower beef prices are adding pressure to lower pork prices, along with an anticipated 4.9 percent increase in pork production this year. Large pork supplies are expected to change retail prices in a range of 0.5 percent lower to 0.5 percent higher in 2017, but increase 1.5 to 2.5 percent in 2018. Meanwhile, prices for poultry rose 0.2 percent from July to August and are one percent higher than last year. Despite high broiler production, many broilers have low weights, which along with larger birds demanding higher prices, has contributed to higher retail poultry prices.
Farm Policy Facts Study Addresses Heritage Foundation Suggestions
A study sponsored by seven agriculture groups and released by Farm Policy Facts calls a plan by the Heritage Foundation misleading. Brandon Willis, former Agriculture Department Risk Management Agency administrator, crafted the study “How Heritage Foundation’s U.S. Farm Policy Proposals Would Put America Last.” The Heritage Foundation released a blueprint earlier this year for the 2018 Farm Bill, and claims it is time to change farm policy. The blueprint would eliminate revenue-based crop insurance and the Renewable Fuel Standard, eliminate the Waters of the United States Rule and eliminate bio energy programs. Willis writes in the Farm Policy Facts study that the Heritage Foundation assumes farmers are in a good position economically, but adds the Foundation cherry-picked the data and used a flawed methodology to “exaggerate the financial condition of actual farmers and ranchers.” Willis says 70 percent of the income reported was derived from other sectors. His research shows that wheat, corn and cotton farmers, when all cost are considered, profit less than 30 percent of the time. The study is available at www.farmpolicyfacts.org.
Soybean Growers Want Dicamba Damage Answers
The American Soybean Association is demanding more answers regarding dicamba drift damage. ASA President Ron Moore this week addressed dicamba drift in a statement. Moore says the issue “isn’t going away,” and is “only getting worse.” The Association says it is supporting research at land grant universities to find answers. Moore says the independent research is needed, as well as research by states to “determine the root causes of this widespread problem and how to address them.” There are now a reported 2,200 complaints affecting 3.1 million acres of soybeans in 21 of 30 soybean-growing states, and ASA expects those numbers to climb. Moore says it’s “very important” to recognize that the industry does not have all the data needed to “clearly determine the causes” of dicamba drift damage.
CropLife America CEO to Retire
CropLife America CEO Jay Vroom will retire at the end of 2018, ending nearly 30 years leading the organization. Vroom announced his retirement plans during the general session at the 2017 CLA Annual Meeting in California this week. During the announcement, he said he is “proud to have represented the industry,” during his tenure as CEO. Vroom will continue to serve as president and CEO of CLA over the next twelve months and will assist with the transition through the end of 2018. During that time, the CLA board of directors will work with a search firm to identify potential candidates for the next CEO. CropLife America represents the developers, manufacturers, formulators and distributors of plant science solutions for agriculture and pest management in the United States.
Hurricanes Devastate Puerto Rico Agriculture
Hurricanes Irma and Maria combined destroyed about 80 percent of crops in Puerto Rico. The damage is so heavy that one farmer told the Seattle Times there is “no more agriculture” on the island. Across the island, Maria’s took out entire plantations and destroyed dairy barns and industrial chicken coops. Plantain, banana and coffee crops were the hardest hit. The island suffered a loss of $780 million in agriculture yields, according to Puerto Rico officials. Hurricane Georges in 1998 wiped out about 65 percent of crops and Hurricane Irma, which only grazed the island, took out about $45 million in agriculture production. For more than 400 years, Puerto Rico’s economy was based on agriculture, historically focused on sugar cane, tobacco and citrus fruits. However, that changed after World War II. Puerto Rico now imports about 85 percent of its food, and its food imports are expected to rise drastically.
Coffee Supplies May Drop on Low Farm Earnings
International coffee growers are warning less coffee supplies may be in the future as coffee farmers are earning very little globally. The International Coffee Organization this week said farmers’ low earnings in many countries were depressing supply even as demand grows around two percent annually, according to Reuters. Rabobank last month forecast a 2017-18 global coffee deficit of 6.1 million bags amid rising demand, and signs of tightening supplies that are evident in top coffee grower Brazil, where inventories have dropped sharply. Investing in new coffee trees requires a long-term commitment, one that farmers with low profits are having to carefully consider, leaving global supplies in jeopardy. Coffee is primarily grown in Brazil, Vietnam, Colombia, Indonesia and Ethiopia.
Tuesday, September 26, 2017
U.S. Has First NAFTA Finalization Target
The United States now has a tentative timeline to complete the North American Free Trade Agreement negotiations. The Trump administration notified Congress Friday evening of expected changes to trade remedy law as a result of the ongoing trade talks, according to Politico. Notification is required at least 180 days before a trade agreement is signed, under the trade promotion authority law. The House Ways and Means Committee confirmed it received the notification. Trade promotion authority also requires the administration to give Congress another notification 90 days before signing the agreement and to publish the text of the pact 60 days before signing. The timeline puts March 22nd as the first day a new NAFTA could be signed. However, to have the deal ready to sign, U.S. Trade Representative Robert Lighthizer would have to reach a deal in December and publish the text in January.
U.S. Yet to Propose NAFTA Dairy Fix
The United States has yet to propose changes to the dairy issue between the U.S. and Canada as part of the North American Free Trade Agreement renegotiation. And, Canada’s lead NAFTA negotiator doesn’t expect the United States to make demands for the dairy sector during the current set of talks that conclude Wednesday in Canada, according to the Toronto Star newspaper. President Donald Trump has criticized Canada's supply management system that protects its domestic dairy industry, which Ottawa has vowed to support. Canada's supply management system for dairy has been in place since the 1970s and allows Canada to set production quotas and the price of milk. President Trump has blamed Canada's dairy import restrictions for the economic woes of dairy farmers in New York and Wisconsin. The U.S.-based National Milk Producers Federation earlier this year, along with the Mexico dairy industry, called on negotiators to address Canada’s policy that they say hinder free trade.
Korea to Host KORUS Trade Meeting
South Korea will hold a second round of trade talks with the United States next month. The meeting comes as the Trump administration wants to either renegotiate a free trade agreement between the two, or withdraw from the agreement. A South Korea news agency reports the meeting will take place on October 4th, but the two sides have yet to decide on the specific agenda or their delegations. Last week, the top trade negotiators for Korea and the U.S. met in Washington, D.C., to discuss ways to move forward with the U.S.-Korea Free Trade Agreement, known as KORUS. Washington is seeking to amend the five-year-old deal to address the country's growing deficit in trade with South Korea. Korea previously declined to engage with the U.S. in talks to address KORUS. Korea is the fifth largest U.S. agricultural export market.
WTO Will Investigate U.S. Complaint over China
The World Trade Organization has created a dispute panel to investigate U.S. complaints regarding import quotas by China. The panel came at the request of the U.S. regarding quotas on wheat, rice and corn. The panel on tariff rate quotas for agricultural products was automatically established as it was the second request by the United States at the WTO Dispute Settlement Body, after China blocked the first attempt in August, according to Reuters. The challenge was initiated by the Obama administration in December of last year, and was continued by the Trump administration which says the quotas hurt U.S. farm exports. China calls the quotas “legitimate measures with regard to vital agricultural staples.” However, the U.S. says China pledged to remove the restrictions when it joined the WTO. Some 14 countries including Australia, Brazil, Canada, Japan, and Thailand, as well as the European Union, have joined the dispute.
FMD Language Included in Defense Authorization Act
The National Defense Authorization Act approved last week includes language to require an analysis on Foot and Mouth Disease, or FMD. Language included in the bill by Iowa Republican Senator Joni Ernst includes a provision “recognizing the risk of FMD, or other foreign animal diseases, to U.S. food production, the economy and national security," according to the Senator. The provision directs the Department of Defense and Department of Agriculture to analyze the nation's ability to response to an outbreak. The National Pork Producers Council supports the provision, and noted that without better preparation, Iowa State University economists estimate that an FMD outbreak would cost the beef, pork, corn and soybean industries alone $200 billion over ten years. The Senate passed the $700 billion package last week, and the House of Representatives passed its version of the bill in July. The two versions must be reconciled before Congress can consider a final version.
Census of Agriculture to Start Soon
Farmers will soon receive forms for the 2017 Census of Agriculture. The Department of Agriculture’s National Ag Statistics Service says farmers and ranchers across the nation will begin receiving the forms in eight weeks. Producers can mail in their completed census form, or respond online. Conducted once every five years, the census of agriculture is a complete count of all U.S. farms, ranches, and those who operate them. USDA says it is the only source of uniform, comprehensive and impartial agriculture data for every state and county in the country. Producers will see a new question about military veteran status, expanded questions about food marketing practices, and questions about on-farm decision-making to better capture the roles and contributions of beginning farmers, women farmers and others involved in running the business. More information and the web forms are available, at www.agcensus.usda.gov.
MONTANA TO CUT PROGRAMS AND SERVICES AMID BUDGET SHORTFALL
Source: DTN
HELENA, Mont. (AP) — Montana plans to cut programs and services to fill a projected $227 million budget shortfall in the midst of a disastrous drought and dozens of wildfires that are draining the state treasury.More than 90 percent of Montana is in drought, creating tinderbox conditions that have led to its worst fire year since 2012. The state has spent more than $50 million on fire suppression since June — not counting the U.S. government costs to respond to fires on federal lands — and the blazes are likely to burn well into the fall, driving up those costs.Montana has already exhausted its wildfire suppression reserve account and other emergency funds. Tax collections are below the estimates set in the state budget, adding to the financial strain.The state is required by law to have a cash reserve of at least $143 million, but Gov. Steve Bullock’s administration forecast an $84 million deficit by 2019 if nothing is done — leaving a $227 million gap to fill, even after $70 million in cuts that were triggered last month by low revenue results.As a result, Bullock ordered government agencies to submit proposals Friday to cut their budgets 10 percent, which would amount to at least $237 million in savings over the next two years.Even if the cuts aren’t implemented fully, “program reductions will be substantial,” Bullock budget director Dan Villa said in a letter to department heads.No cuts will take effect until lawmakers scrutinize the plans and make recommendations in a process expected to last at least two weeks.The hardest-hit agency under the 10 percent reduction plan is the state Department of Public Health and Human Services. Bullock asked the department to find ways to trim $105 million in spending over the next two years, including in senior and long-term care, child protection services and addictive and mental disorder programs.“To say this has been difficult is a tremendous understatement,” health department director Sheila Hogan said in an emailed statement. “We will do the best we can to minimize the impact on Montanans as much as possible, but we remain hopeful the legislature will work with the governor to find more responsible solutions.”The state university system must identify another $44 million in spending reductions. State lawmakers already slashed the Office of the Commissioner of Higher Education’s budget in the 2018-2019 state budget passed in April.Those previous cuts left a $19 million shortfall that resulted in tuition hikes, and Deputy Commissioner Tyler Trevor said tuition may have to go up again. It will be up to the Board of Regents to approve the cuts and tuition hikes, Trevor said.“They all will have the ability to weather the storm, it’s just a matter of the tactics we take,” Trevor said of the state’s colleges and universities.The Department of Corrections has the third-highest amount to cut, at $40 million over two years.“Unfortunately, there are no good options for such significant cuts,” said Corrections Director Reginald Michael. “We hope that throughout this process we can identify more responsible solutions to this situation, but for now we’ll keep making public safety decisions in the best interest of Montanans.”
HELENA, Mont. (AP) — Montana plans to cut programs and services to fill a projected $227 million budget shortfall in the midst of a disastrous drought and dozens of wildfires that are draining the state treasury.More than 90 percent of Montana is in drought, creating tinderbox conditions that have led to its worst fire year since 2012. The state has spent more than $50 million on fire suppression since June — not counting the U.S. government costs to respond to fires on federal lands — and the blazes are likely to burn well into the fall, driving up those costs.Montana has already exhausted its wildfire suppression reserve account and other emergency funds. Tax collections are below the estimates set in the state budget, adding to the financial strain.The state is required by law to have a cash reserve of at least $143 million, but Gov. Steve Bullock’s administration forecast an $84 million deficit by 2019 if nothing is done — leaving a $227 million gap to fill, even after $70 million in cuts that were triggered last month by low revenue results.As a result, Bullock ordered government agencies to submit proposals Friday to cut their budgets 10 percent, which would amount to at least $237 million in savings over the next two years.Even if the cuts aren’t implemented fully, “program reductions will be substantial,” Bullock budget director Dan Villa said in a letter to department heads.No cuts will take effect until lawmakers scrutinize the plans and make recommendations in a process expected to last at least two weeks.The hardest-hit agency under the 10 percent reduction plan is the state Department of Public Health and Human Services. Bullock asked the department to find ways to trim $105 million in spending over the next two years, including in senior and long-term care, child protection services and addictive and mental disorder programs.“To say this has been difficult is a tremendous understatement,” health department director Sheila Hogan said in an emailed statement. “We will do the best we can to minimize the impact on Montanans as much as possible, but we remain hopeful the legislature will work with the governor to find more responsible solutions.”The state university system must identify another $44 million in spending reductions. State lawmakers already slashed the Office of the Commissioner of Higher Education’s budget in the 2018-2019 state budget passed in April.Those previous cuts left a $19 million shortfall that resulted in tuition hikes, and Deputy Commissioner Tyler Trevor said tuition may have to go up again. It will be up to the Board of Regents to approve the cuts and tuition hikes, Trevor said.“They all will have the ability to weather the storm, it’s just a matter of the tactics we take,” Trevor said of the state’s colleges and universities.The Department of Corrections has the third-highest amount to cut, at $40 million over two years.“Unfortunately, there are no good options for such significant cuts,” said Corrections Director Reginald Michael. “We hope that throughout this process we can identify more responsible solutions to this situation, but for now we’ll keep making public safety decisions in the best interest of Montanans.”
Monday, September 25, 2017
“Race for the Steaks” 5K and 15K Run
Boise, ID (September 25, 2017)– The Idaho Beef Council is excited to announce the fourth annual Race for the Steaks 5K and 15K on Saturday, September 30th. The race is presented by the Idaho Beef Council and is in partnership with the Boise YMCA. Race for the Steaks is a running and walking event featuring a unique evening start of 4:30 p.m. for both distances and a full tri-tip dinner for all participants. Sockeye Brewing is also a partner in the event and will be serving their locally brewed beers after the event. New this year is the run is being held in Julia Davis Park. The run begins and end in the park and participants can plan to enjoy a beautiful fall evening along the Boise River and Boise Greenbelt. Don’t miss the 2nd annual Run with Herbie Kid’s Race. Kids nine and under will be running in a special short-distance run with Herbie the Hamburger. The race is approximately 300 meters and is held in the park. The Run with Herbie race is not timed and results will not be posted. Race for the Steaks is open to all athletes age 10 and up. The cost to participate in the event is $30 for youth and $35 for adults. In addition to the dinner, participants will also receive an official Race for the Steaks running shirt. Dinner tickets for spectators can be purchased for $12. Don’t miss this unique family-fun event. The weather looks perfect for an evening run and dinner. For more information about Race for the Steaks, contact the Idaho Beef Council at (208) 376-6004. To participate or for race information, visit http://www.ymcatvidaho.org/runs/ymca-race-for-the-steaks/. More information is also available at www.raceforthesteaks.com.
Federal police in Brazil send formal request to prosecutors to pursue insider trading charges
Federal police in Brazil sent a formal request to prosecutors to pursue insider trading charges against Wesley and Joesley Batista, owners of JBS SA.On Sept. 21, police accused both Batista brothers of illegally profiting on trades made prior to a plea bargain deal in mid-May. Police allege the brothers saved $44 million by doing illegal trades prior to the announcement of the plea agreement, according to a report by Reuters.The plea deal was arranged with federal prosecutors after Wesley and Joesley Batista admitted to bribing 1,900 politicians. The corruption scandal goes all the way to the top of Brazilian politics with President Michel Temer’s alleged involvement.Joesley Batista was the first to go to jail on Sept. 10 when he turned himself into authorities when it was revealed he may have taken advantage of prosecutors during the plea deal by withholding information. Wesley Batista was then arrested on Sept. 13 for insider trading and a warrant was issued for Joesley’s involvement.A request to release the brothers from jail was denied on Sept. 22 by the Supreme Court, upholding a decision made by a lower court earlier in the week.By law, prosecutors in Brazil are left to handle lodging formal charges once a police investigation has concluded.Following the legal developments JBS has restructured the business by removing Wesley as the CEO and bringing back his father and company founder, José Batista Sobrinho, to run the world's largest meat packer.
Cow slaughter figures running higher this year
Cow slaughter figures have been running higher this year, showing year-over-year gains all but three weeks of 2017. Year-to-date, the number of total cows moving through the system is about 7 percent higher. Weekly slaughter rates were averaging 5 percent above a year ago through April, and 8 percent above a year ago April to July. Since then, slaughter rates have expanded to 10 percent above a year ago.Both the beef and dairy herds are sending cows to slaughter at a higher rate than in 2016, and rates across both herds have increased in the later part of the year. Dairy cow slaughter year-to-date is 4 percent higher than 2016 and in recent weeks has averaged 7 percent higher compared to the 1 percent higher seen in the first third of the year. The beef herd, on the other hand, has seen some heavier culling this year. Beef cow slaughter is 11 percent higher through mid-September of this year. Weekly slaughter rates have increased by double-digits nearly every week since mid-June. During that timeframe, beef cow slaughter averaged about 14 percent higher than a year ago.
Outcome-Based Grazing Allows Flexible Livestock Management on Public Land
WASHINGTON (September 22, 2017) – The Bureau of Land Management (BLM) today launched a demonstration program allowing stakeholders in the grazing community an opportunity to achieve rangeland health goals on public land while allowing greater flexibility in livestock management decisions. The program focuses on responsive outcome-based grazing on public lands.Six to twelve “Outcome-Based Grazing Authorizations” will be identified by the BLM in the first twelve months, and the selected permittees will participate in the demonstration program. Participants will actively implement a responsive grazing management plan to achieve habitat and vegetation goals on public land. The program will examine the effectiveness of a more flexible approach to livestock grazing on public land.“Previously, ranchers have been held to a process and prescription method that tells them how to manage their land,” said Dave Eliason, Utah rancher and president of the Public Lands Council (PLC). “It’s irrational to think government officials can make a more informed decision than those who live and work on the land. When responsive management decisions fall into the hands of those who best understand it, the land, animals, and ecosystem thrive.”Craig Uden said the cattle industry is pleased by the Trump Administration’s push to support grazing on public land, and stressed the value of shared stewardship and trust that is established through this program.“The livestock industry is thankful for the leadership of Secretary Zinke in establishing a demonstration program that allows flexibility in the ability to manage conditions on the ground,” said Uden, president of the National Cattlemen’s Beef Association (NCBA). “This decision ensures our public lands are managed in an efficient and sustainable way.”The announcement of this program coincides with the execution of a new Cooperative Monitoring Memorandum of Understanding between the Public Lands Council and the BLM during PLC’s annual meeting in Flagstaff, Ariz.Permittees, Lessees, rangeland ecologists, and other stakeholders are eligible for the program. Interested participants should contact their local BLM office. Project proposals will be accepted through Oct. 13. For more information, visit www.blm.gov.
Coalition Urges Support for Berry Amendment
The American Sheep Industry Association joined 22 other trade groups this week in a letter urging the rejection of several provisions in the Fiscal Year 2018 National Defense Authorization Act. These provisions would "erode our domestic manufacturing base, weaken Buy American provisions, and threaten our national defense."
The coalition's objections were included in the Senate version of the bill (H.R. 2810), which was passed on Monday, Sept. 18. The bill now moves to conference.
"Of key concern are those provisions that would affect the Berry Amendment," read the letter to chairs and ranking members of the House and Senate Armed Services Committees. "Since 1941, the Berry Amendment has ensured that the U.S. has a competitive and capable domestic industry equipped to supply a variety of goods for military use. The elimination or reduction of Berry and similar requirements will result in a less robust and capable domestic industrial base and use of American taxpayer funds to support foreign competitors and outsourcing of manufacturing jobs.
"As associations that represent U.S. manufacturers, U.S. workers and other important aspects of the domestic supply chain for American-made and sourced goods and equipment that our military and warfighters depend upon, we encourage the conference committee to recede to the House bill for each of the cited provisions that undermine existing Buy American laws and regulations."
The coalition's objections were included in the Senate version of the bill (H.R. 2810), which was passed on Monday, Sept. 18. The bill now moves to conference.
"Of key concern are those provisions that would affect the Berry Amendment," read the letter to chairs and ranking members of the House and Senate Armed Services Committees. "Since 1941, the Berry Amendment has ensured that the U.S. has a competitive and capable domestic industry equipped to supply a variety of goods for military use. The elimination or reduction of Berry and similar requirements will result in a less robust and capable domestic industrial base and use of American taxpayer funds to support foreign competitors and outsourcing of manufacturing jobs.
"As associations that represent U.S. manufacturers, U.S. workers and other important aspects of the domestic supply chain for American-made and sourced goods and equipment that our military and warfighters depend upon, we encourage the conference committee to recede to the House bill for each of the cited provisions that undermine existing Buy American laws and regulations."
Tyson Considering Alternative Sites for Kansas Processing Facility
Tyson Foods Inc. is mulling as many as 20 alternative sites in Kansas after Leavenworth County, Kansas withdrew plans to issue $500 million in bonds for a proposed facility in Northwest Kansas county. Kansas Agriculture Secretary Jackie McClaskey last week said as many as 20 other communities in Kansas had expressed interest in becoming the new location for the $320 million facility. McClaskey says that the long-term effect if Tyson moves the plant and its 1,600 jobs to another state could push other agricultural companies away from Kansas. However, she believes a new deal can be reached to keep the new Tyson complex in the Sunflower State, according to meat industry publication Meatingplace. Meanwhile, the Iowa Economic Development Authority last week voted to award $2.4 million in tax benefits to help Tyson expand and renovate its Waterloo, Iowa beef and pork plant.
Arkansas Moving Closer to Seasonal Dicamba Ban
Arkansas is now one step away from establishing a seasonal dicamba ban. The Arkansas State Plant Board advanced a proposal last week saying the use of dicamba should be prohibited from April 16th to October 31st, 2018. The move comes after farmers complained that soybeans and other crops were damaged when the herbicide drifted away from where it was sprayed this summer. However, another group of farmers petitioned the state against the ban. The St. Louis Post-Dispatch reports Monsanto previously submitted a petition asking the board to reject the proposed cutoff date for sprayings and warned the company might file a lawsuit if the board denied the request. A Monsanto spokesperson told the newspaper “volatility is not a problem” and that science did not support the plant board's decision. However, experts say dicamba is risky because it can vaporize and drift across fields after they are sprayed.
New Zealand Triples U.S. DDGS Purchases
Record milk production in New Zealand has led the nation to triple the amount of imported U.S. distiller’s dried grains with solubles. The U.S. Grains Council reports that the 2017 milk supply in New Zealand is expected to reach 21.9 million tons, surpassing the prior record of 2014, thanks to higher-expected cow numbers and optimal pasture conditions. With further opening of the market for U.S. exports, the Grains Council says grain buyers significantly increased purchases due to local crop failures and local market limitations. New Zealand has purchased 113,000 metric tons of U.S. DDGS in the 2016/2017 marketing year, up significantly from the 37,000 tons imported the same time the year prior. The Grains Council says that while this market is currently small, these sales represent the potential for demand growth. A spokesperson with USGC says: “We expect to see strong demand for U.S. DDGS into this market in coming years.”
Rural Mainstreet Index Lower
The Rural Mainstreet Index fell to its lowest level of the year last month as farmland prices declined and agriculture equipment sales were dismal. The index, compiled by Nebraska’s Creighton University, surveys bank CEO’s in ten Midwestern states. Overall, the index, which ranges between 0 and 100, slumped to 39.6, its lowest level since December 2016, and down from 42.2 in August. More than half of respondents reported they are restructuring farm loans while approximately 18 percent indicated their bank had increased collateral requirements. The confidence index, which reflects expectations for the economy six months out, increased to a weak 36.1 from 35.6 in August, indicating a continued pessimistic outlook among bankers. Organizer Ernie Goss says: “Concerns about trade, drought conditions in portions of the region, and low agriculture commodity prices impaired bankers’ economic outlook for the month.”
Trade Officials Talks KORUS
Trade leaders from South Korea and the United States met for the first time last week to discuss the U.S.-Korea Free Trade Agreement. The Trump administration has targeted the free trade agreement for renegotiation, or even termination. A South Korea-based news agency reports U.S. Trade Representative Robert Lighthizer met with South Korea’s Trade Minister to “discuss ways to move forward” with KORUS. In a statement, South Korea says the nation will hold talks with the U.S. “with an open attitude to maximize the mutual benefit of KORUS.” Washington has blamed KORUS for its growing trade deficit. But South Korea argues the deficit is due to macroeconomic factors, and the agreement has benefited both sides. President Donald Trump has called the agreement a "horrible" trade deal. However, Trump also met with South Korea's President last week and said they would "try and straighten out” the pact.
Froman Says NAFTA Withdraw a Very Real Prospect
Former U.S. Trade Representative during the Obama administration Michael Froman says a U.S. withdrawal from the North American Free Trade Agreement is still “a very real prospect.” Froman spoke last week in Washington, D.C. at an event hosted by the University of California. Politico reports Froman said: "There certainly is a desire by the president to withdraw from something, and NAFTA and the Korea agreement appear to be at the top of his list." His comments came as negotiators from the U.S., Canada and Mexico are holding round three of NAFTA renegotiation talks. The current round of negotiations, held in Canada, is set to conclude later this week. NAFTA is worth billions of dollars in exports to U.S. agriculture, and a withdraw from the agreement would put those exports in jeopardy.
Washington Insider: Bearish Prospects for NAFTA
Most urban dailies are taking a look at NAFTA this week as the third Round of talks gets under way in Ottawa, Canada. For example, both the New York Times and Washington Post emphasized that President Trump "has spent months pummeling the North American Free Trade Agreement". He called the trade pact a "disaster" and insisted that it cost American jobs.And, they all emphasized that that this Round will tackle "NAFTA's thorniest issues." The Post concluded that "it is not clear that the trading relationship will emerge intact.The talks, which have centered on logistics and topics of agreement, are now heading into the gritty details of "proposals that could ultimately upend the pact and force any of the trading partners to walk away from the deal," the Times said.The American government is prepared to come out swinging. Wilbur Ross, the secretary of commerce, wrote in an op-ed in The Washington Post on Thursday that NAFTA has provided too many advantages to workers and countries outside the North American pact and put American jobs at risk.His comments were underscored by an accompanying Commerce Department report, released on Friday, which included data showing that fewer of the components and raw materials of goods traded under NAFTA have been made in the United States since 1995, a year after the pact went into effect. The report also said the share of content from trading partners outside NAFTA, including China, has risen sharply in imports into the United States from Mexico and Canada.The Trump administration's report is expected to dominate NAFTA discussions over so-called rules of origin—rules that govern what share of a good must be produced in North America to qualify for NAFTA's zero tariffs, in many cases. The United States is expected to push for raising those limits and negotiators also appear poised to argue for a new requirement on how much of those need to be made in the United States.For the administration, the ultimate goal of these policies is spurring American manufacturing and reducing the trade deficit.John McLaren, an economist at the University of Virginia who has researched the effects of NAFTA, cautioned that changing the rules now could have unintended side effects if they disrupt the supply chains that industries have built up around the existing NAFTA rules. While McLaren has done research showing NAFTA contributed to slower wage growth among some workers, he said the system is so ingrained that changing it now could actually create worse outcomes for workers.McLaren's research has shown that, in the towns and industries most affected by NAFTA, some blue-collar workers saw their wages grow more slowly than workers elsewhere between 1990 and 2000."But given the changed environment in the 20 years since, I do not see how those same workers would benefit now from paralyzing NAFTA through excessive rules of origin," McLaren said. "What Mr. Ross is suggesting sounds a bit more like 'strangling American manufacturing."Canadian and Mexican negotiators have said that they would be opposed to any United States-specific content requirement. But this may be only one of several controversial issues on the table, as negotiators consider proposals over protecting intellectual property, raising labor standards and settling corporate disputes.Alejandro Poire, dean of the School of Social Sciences and Government at Tecnologico de Monterrey in Mexico, said some of the negotiators around the table for NAFTA talks also worked together on the proposed Trans-Pacific Partnership, a 12-country trade deal negotiated during the Obama administration.Mr. Trump withdrew from that pact, which he also criticized as a bad deal, on one of his first days in office. Many of the basic proposals to modernize NAFTA this time around are drawn from the agreements that the United States, Canada and Mexico forged as they negotiated the TPP.Given that the same negotiators are hashing out many of the same points, the countries are so far basically in agreement, Poire said. But those areas of agreement "are about to run out. So one would expect increasing levels of controversy in the next few weeks," he said.When that happens, negotiators will turn increasingly to the agenda of Trump and his advisers. The president has denounced the TPP and existing American trade policy and some of the administration's proposed policies represent a sharp turn.That may put an untenable amount of pressure on the pact. If the three countries cannot come to an agreement, Trump has said repeatedly that he would be willing to walk out.This kind of talk makes many ag groups very, very nervous. Occasional nods from negotiators including comments that they know about ag's concern that the talks first, "do no harm" to current markets. Still, at the current time, reviews of NAFTA and what's expected frequently seem to raise tensions among ag producers—and, certainly suggest that they should watch the talks closely as they continue, Washington Insider believes.
RCEP Talks Stall As Rival TPP Reemerges
As negotiators seek to wrap up the 16-nation Regional Comprehensive Economic Partnership (RCEP) trade pact they are facing a new challenge with the resurgence of the rival Trans-Pacific Partnership (TPP) agreement.When President Donald Trump withdrew the U.S. from TPP shortly after taking office, Asia Pacific nations turned their focus to RCEP. Now, the 11 remaining TPP members are making an effort to resurrect that deal, while progress has stalled on RCEP.The goal of an agreement by end-year on RCEP, which includes China, India and Japan, but not the U.S., will not be reached, according to chief negotiator Iman Pambagyo. Still, a bigger concern for him is that some RCEP members may exit the deal to prioritize TPP, a pact that does not include China."Perhaps down the road, toward the end of the year, someone will say, 'That's enough for me. We're not joining at this point. We will join on some other date,'" Pambagyo said in an interview earlier this week. It is possible the pact could lose two to three members, he remarked. He did not specify which countries were at risk of leaving.
Friday, September 22, 2017
LIVESTOCK SLAUGHTER – AUGUST 2017 UNITED STATES HIGHLIGHTS
Commercial red meat production for the United States totaled 4.63 billion pounds in August, up 4 percent from the 4.43 billion pounds produced in August 2016. Beef production, at 2.40 billion pounds, was 6 percent abov Beef production, at 2.40 billion pounds, was 6 percent above the previous year. Cattle slaughter totaled 2.94 million head, up 7 percent from August 2016. The average live weight was down 7 pounds from the previous year, at 1,345 pounds. Veal production totaled 6.4 million pounds, 5 percent above August a year ago. Calf slaughter totaled 46,200 head, up 13 percent from August 2016. The average live weight was down 17 pounds from last year, at 238 pounds. e the previous year. Cattle slaughter totaled 2.94 million head, up 7 percent from August 2016. The average live weight was down 7 pounds from the previous year, at 1,345 pounds. Veal production totaled 6.4 million pounds, 5 percent above August a year ago. Calf slaughter totaled 46,200 head, up 13 percent from August Hog slaughter totaled 10.7 million head, up 3 percent from August 2016. 2016. The average live weight was down 17 pounds from last year, at 238 pounds. Pork production totaled 2.21 billion pounds, up 3 percent from the previous year. The average live weight was up 2 pounds from the previous year, at 278 pounds. Lamb and mutton production, at 12.8 million pounds, was up 2 percent from August 2016. Sheep slaughter totaled 194,100 head, slightly above last year. The average live weight was 132 pounds, up 2 pounds from August a year ago. January to August 2017 commercial red meat production was 34.0 billion pounds, up 4 percent from 2016. Accumulated beef production was up 5 percent from last year, veal was down 1 percent, pork was up 3 percent from last year, and lamb and mutton production was down 4 percent.
The European Union’s Uneasy Relationship with Science
By Elizabeth Westendorf, USW Assistant Director of Policy
Last week, the European Court of Justice ruled that EU member states cannot ban cultivation of genetically engineered crops without scientific evidence of risk to human health. The ruling was on a case that dates back to 2013, when an Italian farmer wanted to plant biotech corn. Italy has long banned the planting of genetically engineered crops. The farmer in question, Giorgio Fidenato, planted the corn on his land in defiance of Italy’s ban. Four years later, it is a win for science-based regulation that the European Court of Justice sided with Fidenato and ruled that Italy does not have the right to ban GM crops without a scientific reason.
It is not all good news for science in Europe though. The EU has previously had pesticide legislation that sets risk-based tolerances and maximum residue levels (MRLs). However, the EU is now in the process of introducing hazard-based restrictions on import tolerances. These restrictions are not only contrary to the EU’s MRL legislation but also contrary to the World Trade Organization (WTO) Sanitary and Phytosanitary (SPS) Agreement, which requires that decisions be based on risk assessments. A hazard-based approach risks significantly impacting trade and affecting product availability in the EU. This would also jeopardize trade litigation that could result in retaliation against billions of dollars of its exports.
For a highly traded commodity like wheat, it is imperative that regulatory systems worldwide be transparent and science-based. Otherwise, exporters jeopardize having shipments held up — or prevented altogether — and importers cannot rely on deliveries arriving in a timely manner. When technology does not have a negative impact on health or the environment, there is no reason for countries to needlessly restrict its use, or worse, vilify its existence. It is heartening that the EU has taken a step in the right direction on biotechnology, but they are moving backward on SPS issues that could inhibit trade and hurt domestic businesses. Unscientific regulations make it hard for a globalized market to function well.
Last week, the European Court of Justice ruled that EU member states cannot ban cultivation of genetically engineered crops without scientific evidence of risk to human health. The ruling was on a case that dates back to 2013, when an Italian farmer wanted to plant biotech corn. Italy has long banned the planting of genetically engineered crops. The farmer in question, Giorgio Fidenato, planted the corn on his land in defiance of Italy’s ban. Four years later, it is a win for science-based regulation that the European Court of Justice sided with Fidenato and ruled that Italy does not have the right to ban GM crops without a scientific reason.
It is not all good news for science in Europe though. The EU has previously had pesticide legislation that sets risk-based tolerances and maximum residue levels (MRLs). However, the EU is now in the process of introducing hazard-based restrictions on import tolerances. These restrictions are not only contrary to the EU’s MRL legislation but also contrary to the World Trade Organization (WTO) Sanitary and Phytosanitary (SPS) Agreement, which requires that decisions be based on risk assessments. A hazard-based approach risks significantly impacting trade and affecting product availability in the EU. This would also jeopardize trade litigation that could result in retaliation against billions of dollars of its exports.
For a highly traded commodity like wheat, it is imperative that regulatory systems worldwide be transparent and science-based. Otherwise, exporters jeopardize having shipments held up — or prevented altogether — and importers cannot rely on deliveries arriving in a timely manner. When technology does not have a negative impact on health or the environment, there is no reason for countries to needlessly restrict its use, or worse, vilify its existence. It is heartening that the EU has taken a step in the right direction on biotechnology, but they are moving backward on SPS issues that could inhibit trade and hurt domestic businesses. Unscientific regulations make it hard for a globalized market to function well.
National Weather Service's forecast for October through December calls for above-normal temps across the contiguous U.S
The National Weather Service's (NWS) forecast for October through December calls for above-normal temps across the contiguous U.S., with the greatest chance of warmth across the Four-Corners region. This could result in some areas of the country needing spring-time rains for planting season, especially given the recent spread of drought across the Midwest, Kansas and continued drought conditions across the Northern Plains.Meanwhile, it calls for above-normal precip across the Pacific Northwest and below-normal precip along the Gulf Coast into Missouri. Below-normal precip is also expected across eastern Kansas and Oklahoma. Meanwhile, the rest of the country has equal chances of normal, below- or above-normal precip.
Thursday, September 21, 2017
Commodity groups on Wednesday praised the introduction of legislation in the U.S. Senate that would double funding for a pair of USDA export programs
Commodity groups on Wednesday praised the introduction of legislation in the U.S. Senate that would double funding for a pair of USDA export programs.The bill introduced by Sens. Susan Collins, R-Maine, Joe Donnelly, D-Indiana, Joni Ernst, R-Iowa, and Angus King, I-Maine, would increase funding for the Market Access Program (MAP) and Foreign Market Development Program (FMD). Commodity groups have been championing the need to boost funding for both of those programs during hearings on the next farm bill. The bill, Cultivating Revitalization by Expanding American Agricultural Trade and Exports -- CREAATE -- would essentially achieve that goal. The bill serves as a marker for the senators to champion during the farm-bill debate.A similar bill has been introduced in the House by Rep. Dan Newhouse, R-Washington, and Rep. Chellie Pingree, D-Maine.MAP is currently funded at $200 million a year and the FMD program is funded at $34.5 million. Under the bill, funding would increase by 2023 to $400 million for MAP and $69 million for FMD.MAP basically provides matching funds to groups such as trade groups and checkoff organizations to promote genetic products. Groups typically contribute twice the match for such funds. MAP can also be used to promote branded products as well with a dollar-for-dollar match.FMD is a cooperator program specifically for the checkoffs to promote trade and market activities overseas.A study by land-grant universities in 2016 stated MAP and FMD helped generate roughly $8.2 billion a year more in agricultural exports from 1997 to 2014.Beyond lamenting the loss of the Trans Pacific Partnership, farm groups have lamented MAP and FMD are underfunded compared to trade promotion programs in other countries, notably the European Union. Final funding to organizations also usually ends up lower than the allocations to USDA. MAP last year handed out funds of $173.5 million and FMD funded $26.6 million to various groups.Commodity groups praised the legislation on Wednesday, stating it would help boost U.S. agricultural exports. They stated that every dollar invested in MAP and FMD translates into $28 to $30 in exports."With the United States exporting 50% of its wheat, a strong trade agenda is essential for growing and opening new markets for wheat growers abroad," said Chandler Goule, chief executive officer of the National Association of Wheat Growers.John Heisdorffer, and Iowa farmer and vice president of the American Soybean Association, said MAP and FMD are success stories when it comes to partnerships between farmers and the federal government. "We work together with the U.S. Soybean Export Council to leverage MAP and FMD funds to establish and expand markets for American soy in all corners of the globe, and the CREAATE Act will go a long way to ensuring that good work can and will continue," Heisdorffer said.The National Corn Growers Association also weighed in. Wesley Spurlock, a Texas farmer and NCGA president, said funding for MAP and FMD must increase. Funding has not kept up with inflation in the past while administrative costs have increase. Along with that, if changes are not made, FMD could lose its baseline funding in the next farm bill."Now more than ever, we need to invest in export and market development programs like these to build global demand and help farmers' bottom lines," Spurlock said.
USDA released an audit this week of the National Organic Program
USDA's Office of Inspector General released an audit this week of the National Organic Program that found the program was lacking control and oversight of imports coming into the country that were declared "organic."The audit highlighted that at least some imported food and feed products did not have the paper trail to prove they were actually raised under organic standards. Adding to that, USDA's Agricultural Marketing Service had no controls in place at ports of entry to ensure importers are meeting U.S. organic standards. USDA had not worked with the U.S. Customs and Border Protection to ensure U.S. organic requirements are met and there was an adequate paper trail from importers.USDA's Agricultural Marketing Service, which oversees the National Organic Program, largely concurred with the Inspector General's audit and stated in response that USDA was taking several actions to tighten controls of imported organic products.Imports of organics have soared in recent years, but there have been growing doubts over whether those products are actually organic. This is especially true for the spike in imports of commodity crops, including organic feed. Imports of organic corn have risen from 3.1 million bushels in 2014 to an estimated 20 mb this year. Organic soybean imports hit 40 mb last year.The incentives for importing commodities and dubbing them "organic" can be significant. Cash prices for domestic organic corn currently run from $8 to $9 a bushel while cash bids for organic soybeans are $16.75 to $17.50 a bushel, according to USDA's latest National Organic Grains and Feedstuffs report. Those compare to standard commodity prices under the DTN National Corn Index at $3.04 a bushel and the DTN National Soybean Index of $8.96 a bushel.The OIG also found that USDA's process for determining equivalency standards overseas lacks transparency. There are documents to resolve differences between U.S. and foreign organic standards, but there is no methodology to disclose how that works to industry. Along with that, USDA "was unable to provide reasonable assurance" that the proper paperwork was reviewed at U.S. ports to verify that products called organic actually came from certified organic farms overseas and businesses that grow and sell organic products.Further, some of the fumigation actions taken at port to deal with pests effectively converted commodities from being organic. USDA's Agricultural Marketing Service has not established controls at ports to track whether products fumigated with non-organic chemicals are then not sold as organic.The USDA audit came after the Washington Post tracked a shipment of 650,000 bushels of soybeans earlier this year from the Ukraine and shipped through Turkey that ended up being labeled as "organic" once the shipment arrived in the U.S. The Post found several thousand bushels of corn and soybeans that were being declared as organic once they were shipped, even though there was no evidence they were grown under organic standards. USDA ended up pulling the organic certification of a Turkish company following its own investigation into the situation.Part of the challenge facing the National Organic Program is that it has a $9.1 million funding level to oversee a U.S. organic industry that pulled in roughly $47 billion in sales and is growing at roughly $3.5 billion in sales annually.The Organic Trade Association released a statement saying the OIG report supports the group's position that more trade oversight and monitoring are needed to protect the integrity of the program. The group stated that it is pursuing legislative changes in the next farm bill to give the National Organic Program more tools to deal with fraud, such as electronic tracking of shipments.The entire audit had nine different recommendations for USDA to improve the organic program, which included the need to strengthen control over imports and verify documents at U.S. ports of entry. Along with that, USDA needs to ensure more transparency regarding how USDA and foreign countries determine final equivalency in organic standards. USDA also is now working with Customs and Border Protection on a memorandum of understanding to review National Organic Program certificates at ports. That memorandum of understanding will be in place sometime in the first half of 2018, USDA stated. Along with that, USDA also needs to ensure more controls are implemented at ports to ensure that products needing fumigation at ports are not sold as organic products. The Inspector General's office did acknowledge that USDA organic officials are improving the process to prevent such sales.The audit was released just after Miles McEvoy, deputy administrator of USDA's National Organic Program, announced last week he would leave his position at the end of September. McEvoy joined the National Organic Program in 2009 after overseeing a similar program in Washington State.
NAFTA Talks Head to Canada Next Week
The third round of formal negotiations on the North American Free Trade Agreement gets underway next week in Canada. Round three of the talks are planned in Ottaway September 23rd through September 27th. The meeting follows the first set of talks in Washington, D.C., and the second round of talks held in Mexico City, Mexico earlier this month. However, rounds one and two were largely uneventful with little resolution on major trade issues between the NAFTA partners, and there’s a hinting from the administration that a deal may not be reached. Any negative trade impacts to agriculture would be significant. Mexico exports $23 billion of agricultural products to the U.S., while Canada exports $22 billion. Canada and Mexico are top markets for U.S. agricultural products, as well. Corn exports to Mexico alone are worth an estimated $2.6 billion, while soybean exports to Mexico from the U.S. are worth an estimated $1.5 billion. For exports to Canada, it’s estimated that the U.S. exports $4.8 billion worth of fresh and processed fruits and vegetables.
Conaway, Perdue, Visit Texas
Agriculture Secretary Sonny Perdue and Texas Representative Mike Conaway, Chairman of the House Agriculture Committee, are in Texas this week to survey hurricane damage. The two are visiting the Houston area to survey agricultural damage from Hurricane Harvey. Damages from Hurricane Harvey are estimated to cost Texas agriculture billions of dollars from losses to crops and livestock. The area declared as a disaster by Texas Governor Greg Abbott contains about 1.2 million cattle, which is roughly 27 percent of the state’s cowherd. The losses from Harvey will reduce the state’s expected two million bale cotton harvest by as much as 400,000 bales. Perdue and Conaway will also make a stop at the Houston Food Bank on Thursday. Friday, the duo will travel to West Texas where the two will address the Southwest Council of Agribusiness, which is holding its annual meeting in Lamesa, Texas.
Ag Exports Groups Urge Passage of the CREAATE Act
A coalition supporting ag exports is urging Senators to pass legislation to expand the Market Access Program and Foreign Market Development program. The Coalition to Promote U.S. Agricultural Exports and the Agribusiness Coalition for Foreign Market Development say the Cultivating Revitalization by Expanding American Agricultural Trade and Exports, or CREAATE Act, would boost trade’s impact on U.S. farmer profitability and the U.S. economy. The bipartisan legislation follows a House version of the bill introduced in May. The bill would increase statutory funding for the programs, which are now authorized at $200 million per year for MAP and $34.5 million per year for FMD. The two coalitions say both programs have faced stagnant funding and eroding real dollar impact due to inflation, sequestration, administrative costs and increased global competition.
Milk Processing Expansion Needed
A report by CoBank shows U.S. milk production growth is outpacing processing capacity growth, leaving dairy processors struggling to keep pace. Every year, U.S. dairy farmers produce three billion more pounds of milk than the year before. CoBank says that those increase challenge processers, who will need an estimated 27 billion pounds more of U.S. milk processing capacity over the next ten years if current trends persist. The report says that numerous new plants and plant expansion projects are underway or recently completed, but available capacity remains a challenge at times, especially in the Northeast and Mideast areas, and has strained the ability of dairy cooperatives to fill the role of market balancers. Since these co-ops largely bear the brunt of the near-term oversupply of milk, they are increasingly looking for ways to discourage producers from expanding production.
EPA Mulling Options on Dicamba
The Environmental Protection Agency aims to allow farmers to use dicamba next year, but with additional rules in place. An EPA official in the agency’s Office of Pesticide Programs told Reuters this week the agency had not yet determined what steps it would take to mitigate problems associated with dicamba. The herbicide was linked to widespread crop damage this summer. EPA officials have met with state regulators to find ways to prevent crop damage, along with negotiating with herbicide companies BASF and Monsanto. The comments by the EPA hint that the agency is unwilling to set a ban on the product after a certain date that would prohibit post-emergence or "over the top" spraying of dicamba. An EPA official told state regulators the agency was "very concerned with what has occurred and transpired in 2017," and says the EPA is “committed to taking appropriate action for the 2018 growing season with an eye towards ensuring that the technology is available,” and that growers use it responsibly.
2016 Organic Sales Up 23 Percent
Sales of organic agriculture products increased 23 percent in 2016, compared with levels from 2015, according to the Department of Agriculture. The USDA National Agricultural Statistics Service released the annual Certified Organic Survey Wednesday. The survey finds U.S. farms produced and sold $7.6 billion in certified organic commodities, up 23 percent from $6.2 billion in 2015. During the same year, the number of certified organic farms in the country increased 11 percent to 14,217, and the number of certified acres increased 15 percent to five million. California, with $2.9 billion in certified organic sales, continued to lead the nation in certified sales, accounting for 38 percent of the U.S. total. Ten states accounted for 77 percent of U.S. certified organic sales, virtually the same share as in 2015 and 2014. Top organic commodities, according to USDA, include milk, eggs, broiler chickens, apples and lettuce.
NCGA Supports Funding Increase for MAP, FMD Programs
WASHINGTON (September 20, 2017) – The National Corn Growers Association praised the introduction today of the CREAATE Act, a bill to increase investment in two federal programs with a proven track record of building global demand for U.S. agricultural products.The bipartisan bill, introduced by Senators Angus King (I-Maine), Joni Ernst (R-Iowa), Joe Donnelly (D-Indiana), and Susan Collins (R-Maine), would increase investment in the Market Access Program (MAP) and Foreign Market Development program (FMD). A companion bill was introduced in the House earlier this year.MAP and FMD are public-private partnerships that promote U.S. agriculture. Together, they are responsible for 15 percent of U.S. agricultural export revenue—$309 billion since 1977.“MAP and FMD are critical programs for building and expanding global markets for American agricultural exports. We must increase investment in these programs,” said Wesley Spurlock, a Texas farmer and president of NCGA.“These programs deliver a strong return on investment. Every $1 invested in MAP and FMD generates $28 in exports—that means more American jobs, and more money coming into our communities. Now more than ever, we need to invest in export and market development programs like these to build global demand and help farmers’ bottom lines,” said Spurlock.Funding for MAP and FMD has not kept pace with inflation, administrative costs, the growth of the global marketplace, or the investments other countries have made in their own export promotion. The FMD program is also under threat to lose its baseline funding when the farm bill expires in 2018.The CREAATE Act would gradually increase MAP funding from $200 million to $400 million per year and FMD funding from $34.5 million to $69 million per year, over the next five years.“Thank you to Senator King, Senator Ernst, Senator Donnelly, and Senator Collins for leading the effort to strengthen the MAP and FMD programs. These programs have already been successful, but with increased investment, they can help even more American farmers and ranchers compete around the world,” said Spurlock.
U.S. livestock futures gained on technical buying on Tuesday
U.S. livestock futures gained on technical buying on Tuesday, with feeder cattle rising to a two-month high and lean hogs climbing by as much as 2.6 percent, traders said.Fresh news remained scant, but traders were more optimistic about higher cash prices for both cattle and hogs. Declining prices for corn cut feed costs for livestock producers, bolstering profit margins and boosting demand for feeder cattle."I think the (cattle) market is trying to bottom," said independent livestock trader Tommy Beall. "Corn is cheap enough ... and that's supportive."Chicago Mercantile Exchange October feeder cattle firmed by 0.850 cent to settle at 152.800 cents per pound, the highest since July 20. More actively traded CME October live cattle were up 0.400 cent at 107.975 cents.Live cattle futures continued to rise from multimonth lows notched on Aug. 31 amid ideas that beef packers who were earning big profit margins would pass on some of those gains to the feedlots that sell them cattle.Average beef packer profit margins were estimated at $148.45 per head of cattle, according to HedgersEdge LLC. That is down from $151.30 per head a week ago but up from $67.30 per head a month ago.Analysts polled by Reuters expected the U.S. Department of Agriculture in a monthly report on Friday to show the number of cattle placed in feedlots last month down 2.9 percent from the same month in 2016.
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